Semester 2 Week 4 Tutorial 3 Flashcards
Waldrup Limited have gross wages of £3,400,000 for the month of June 20X5. Related to this is employee’s NI of £600,000, employer’s NI of £720,000 and PAYE of £850,000.
Prepare the journals to account for the wages for June 20X5 and the payment the following month.
Total wages expense = gross wages + employers NI = £3,400,000 + £720,000 = £4,120,000.
Net wages = £3,400,000 - £600,000 - £850,000 = £1,950,000
HMRC creditor = £720,000 + £850,000 + £600,000 = £2,170,000
Dr wages and salaries expense 4,120,000
Cr HMRC creditor 2,170,000
Cr Net wages (bank) 1,950,000
Being wages for month of June
July
Dr HMRC creditor 2,170,000
Cr bank 2,170,000
Being payment of HMRC creditor
Name two short term employee benefits, a long term employee benefit and a post retirement benefit.
Short term employee benefits include wages and salaries and benefits such as gym memberships and season ticket loans.
Long term employee benefits include items such as share schemes.
Post-retirement benefits refer to pensions.
Give three examples of corporate social responsibility activities that a company may engage in.
An open question, this could include activities such as giving staff days off to volunteer for charities, giving money to charities, running collaboration programmes in local schools etc.
What does CSR reporting involve?
In simple terms CSR reporting involves reporting on a company’s CSR activities.
What are some of the benefits and the criticisms of CSR reporting?
There is considerable evidence that CSR reporting causes companies to better consider their activities. There is some evidence that negative actions often come from ignorance rather than active malevolence and therefore making them consider their activities and their impact more leads to better impacts.
Making a CSR report public also means that the organisation is more accountable to the general public. Simply by having to justify and consider its actions means that a company is more likely to act in a more positive manner if it is aware that its actions are under scrutiny.
There are however also problems with CSR reporting.
As there are no (or limited) set rules companies can put in what information they want, there is no requirement for them to include or not include certain information.
Companies can often use CSR reporting as a publicity exercise, using it to promote the business and making themselves look good.
It can also lead to so called “greenwashing” where companies can spend more money on making themselves look good than they do on actually carrying out positive actions.
Outline what makes “good” CSR reporting.
This is, to a large extent, a subjective question. There is no set listing of what makes good CSR reporting. It does, very much, depend on the needs of the individual users. Some ideas, however, might include:
- Useful to users
- Broad and comprehensive
- Addressing a variety of stakeholders
- Reflecting internal and external policies
- Sets targets
- Variety of inputs
Outline the main requirements of the UK Modern Slavery Act and who it applies to.
The UK Modern Slavery Act applies to all companies with a turnover of over £36m. They are required to outline the steps they have taken to ensure there is no forced labour or slavery in their supply chains.
Describe the other CSR reporting requirements in the UK.
In the UK companies are required to report:
- Employee numbers and category split by gender and average pay.
- Details of Greenhouse Gas Emissions
- Information on anti-bribery and anti-crime/terrorism procedures.
What are the problems with a CSR reporting audit?
A CSR reporting audit is a newly developing area of accountancy. With the growth of CSR reporting there is an increasing need to confirm that the information in CSR reporting is, in fact, correct.
There are, however, considerable issues with CSR auditing:
- Unlike standard audits there are no accounting standards or auditing standards. It is therefore difficult to determine what basis you are carrying out the audit on.
- In a similar way there is currently limited regulation of this market, it is therefore potentially possible for anyone to set themselves up as a CSR auditor.
- The information in CSR reports is often “soft”, intangible information that is difficult to measure. While it is relatively simple to measure and confirm figures such as sales or asset values, information such as poverty alleviation, can be difficult to monitor and determine.
